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ECONOMICSECONOMICSECONOMICSECONOMICS

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Instructions for the CandidatesInstructions for the CandidatesInstructions for the CandidatesInstructions for the Candidates1. Write your Seat No. and OMR Sheet No. in the space provided

on the top of this page.2. This paper consists of 50505050 objective type questions. Each question

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1.

2.

3.

(i)

(ii)

(iii)

4. (A), (B), (C) (D)

(C)

5.

6.

7.

8.

9.

10.

11.

12.

A B DA B DA B DA B D

A B DA B DA B DA B D

AAAATest Booklet Code & Serial No.

2222

JAN - 11218/II—AJAN - 11218/II—AJAN - 11218/II—AJAN - 11218/II—A

3 [P.T.O.3 [P.T.O.3 [P.T.O.3 [P.T.O.


1. Autonomous Demand indicates

that .......................... .

(A) Commodity is used both for the

export and direct domestic

consumption

(B) Commodity is used both for the

direct domestic consumption

and as an input to produce

another commodity

(C) Commodity is needed for direct

use but not as an input to

produce another commodity

(D) Commodity is needed as an

input to produce another

commodity but not for the direct

use

EconomicsEconomicsEconomicsEconomicsPaper IIPaper IIPaper IIPaper II

IIIIIIII

Time Allowed : 75 Minutes] [Maximum Marks : 100Time Allowed : 75 Minutes] [Maximum Marks : 100Time Allowed : 75 Minutes] [Maximum Marks : 100Time Allowed : 75 Minutes] [Maximum Marks : 100

Note :Note :Note :Note : This paper contains FiftyFiftyFiftyFifty (50)(50)(50)(50) multiple choice questions, each question

carrying Two (2)Two (2)Two (2)Two (2) marks. Attempt All questions.

(50)(50)(50)(50) (2)(2)(2)(2)

1.

(A)

(B)

(C)

(D)

4444


2. Stay-out pricing approach

.................. .

(A) Helps the firm to ascertain the

maximum possible price it can

charge from its consumers

(B) Helps the firm to ascertain the

minimum possible price it can

charge from its consumers

(C) Helps the firm to ascertain the

maximum price it can pay to its

vendors

(D) Helps the firm to ascertain the

minimum price it can pay to its

vendors

3. Profit maximising amount of inputs

occurs when .................. .

(A) The slope of the Iso-profit line

equals the slope of the

production function

(B) The slope of the Iso-profit line

exceeds the slope of the

production function

(C) The slope of the production

function exceeds the slope of the

Iso-profit line

(D) The slope of the Iso-profit line

exceeds the slope of the Iso-

quant

2.

(A)

(B)

(C)

(D)

3.

(A)

(B)

(C)

(D)

5 [P.T.O.5 [P.T.O.5 [P.T.O.5 [P.T.O.


4. The producer shall not produce in

the third stage of production because

in that stage ................ .

(A) The total product is negative

(B) The marginal product is

negative

(C) The average product is

stagnant

(D) The marginal product is falling

5. If the commodities are perfect

substitutes, the corresponding

indifference curves would be

................... .

(A) Negatively sloping curves

(B) Positively sloping straight lines

(C) Negatively sloping straight

lines

(D) L-shaped straight lines

4.

(A)

(B)

(C)

(D)

5.

(A)

(B)

(C)

(D) L

6666


6. In the context of welfare economics,

the social welfare function was put

forward by .................... .

(A) Hicks and Samuelson

(B) Pigou and Samuelson

(C) Robbins and Scitovszky

(D) Samuelson and Bergson

7. The average fixed cost (AFC) of

production curve is denoted by

............................ .

(A) Rectangular hyperbola

(B) U-shaped curve

(C) L-shaped curve

(D) J-shaped curve

8. In the context of demand theory, the

expression ‘Choice reveals

preference’ is ascribed to .................. .

(A) Paul Samuelson

(B) J.R. Hicks

(C) F. Machlup

(D) Robert Dorfman

6.

(A)

(B)

(C)

(D)

7.

(A)

(B)

(C)

(D)

8.

(A)

(B)

(C)

(D)

7 [P.T.O.7 [P.T.O.7 [P.T.O.7 [P.T.O.


9. Risk-return trade off plays an

important role in whose theory of

money demand ?

(A) Tobin’s Portfolio Choice

(B) Friedman’s restated quantity

theory

(C) Baumol’s inventory theoretic

choice

(D) Cambridge money demand

theory

10. Ratchet effect relates to :

(A) Life-cycle hypothesis

(B) Permanent income hypothesis

(C) Relative income hypothesis

(D) Absolute income hypothesis

9.

(A)

(B)

(C)

(D)

10.

(A)

(B)

(C)

(D)

8888


11. The Samuelson-Hicks type business

cycle models will show stability as

well as cyclical fluctuations only :

(A) Income movement equation

shows complex roots whose

magnitudes are less than one

(B) Income movement equation

shows real roots whose

magnitudes are less than one

(C) Income movement equation

shows complex roots whose

magnitudes are more than one

(D) Income movement equation

shows real roots whose

magnitudes are more than one

12. In simple Keynesian model of output

determination, government

expenditure will have a bigger

impact if :

(A) Marginal propensity to consume

is lower

(B) Marginal propensity to consume

is higher

(C) Marginal propensity to save is

constant

(D) Marginal propensity to consume

is zero

11.

(A)

(B)

(C)

(D)

12.

(A)

(B)

(C)

(D)

9 [P.T.O.9 [P.T.O.9 [P.T.O.9 [P.T.O.


13. Match the following :

Statement 1 Statement 2 Statement 1 Statement 2 Statement 1 Statement 2 Statement 1 Statement 2

(a) Inventory (i) Edmund

approach to Phelps

money demand

(b) Adaptive (ii) William

expectation Baumol

(c) Upper turning (iii)John Hicks

point

(d) Permanent (iv) Milton

income Friedman

Codes :

(a) (b) (c) (d)

(A) (i) (ii) (iii) (iv)

(B) (ii) (iii) (i) (iv)

(C) (ii) (i) (iii) (iv)

(D) (ii) (i) (iv) (iii)

13.

1 1 1 1 2 2 2 2

(a) (i)

(b) (ii)

(c) (iii)

(d) (iv)

::::

(a) (b) (c) (d)

(A) (i) (ii) (iii) (iv)

(B) (ii) (iii) (i) (iv)

(C) (ii) (i) (iii) (iv)

(D) (ii) (i) (iv) (iii)

10101010


14. According to Cambridge version of

demand for money, money demand

will increase if :

(A) Velocity of money increases

alone

(B) GDP in the economy decreases

alone

(C) GDP in the economy and velocity

increase at the same rate

(D) Velocity in the economy

decreases alone

15. If investment becomes totally

interest insensitive, then :

(A) Fiscal policy is ineffective

(B) Fiscal policy is effective

(C) Monetary policy is effective

(D) Both fiscal and monetary policy

are ineffective

14.

(A)

(B)

(C)

(D)

15.

(A)

(B)

(C)

(D)

11 [P.T.O.11 [P.T.O.11 [P.T.O.11 [P.T.O.


16. Long-run Phillips curve will not be

vertical if :

(A) Price inflation partially takes

into account expected price

inflation

(B) Price inflation fully takes into

account expected price inflation

(C) Price inflation does not take into

account expected price inflation

at all

(D) Expected price inflation is

always zero

17. Prof. Mahalanobis developed ...........

model in 1955 which was later used

in Five Year Plans of India.

(A) Four sector

(B) Two sector

(C) Single sector

(D) Three sector

18. World Bank has indicated GDP

growth rate in India is 7.6 percent

in 2016 and will be .................. in

2017.

(A) 7.8%

(B) 7.7%

(C) 7.9%

(D) 8.0%

16.

(A)

(B)

(C)

(D)

17.

(A)

(B)

(C)

(D)

18.

GDP

(A) 7.8

(B) 7.7

(C) 7.9

(D) 8.0

12121212


19. In which strategic sector of Indian

Economy hundred percent Foreign

Direct Investment (FDI) is allowed

recently ?

(A) Science and technology

(B) Space

(C) Defence sector

(D) Critical medicines

20. Which one of the following has

propounded the modern theory of

distribution ?

(A) Nicholas Kaldor

(B) David Ricardo

(C) Mrs. Joan Robbinson

(D) J.S. Mill

21. Cost-Benefit Analysis was developed

in USA for appraisal of investments

in ..................... .

(A) Agriculture and Health projects

(B) Health and Garden projects

(C) Irrigation and Transportation

project

(D) Technology and Health project

19.

(A)

(B)

(C)

(D)

20.

(A)

(B)

(C)

(D)

21.

(A)

(B)

(C)

(D)

13 [P.T.O.13 [P.T.O.13 [P.T.O.13 [P.T.O.


22. Quaternary Sector involves

.................. .

(A) Research and development

(B) Provision of services

(C) Industry and manufacturing

(D) Agricultural services


Theory Theory Theory Theory

(a) Theory of stages of economic

growth

(b) Theory of unlimited supplies of

labour

(c) The Big Push Theory

(d) Theory of unbalanced growth

PropounderPropounderPropounderPropounder

(i) Arthur Lewis

(ii) W.W. Rostow

(iii)A.O. Hirschman

(iv) Rosenstein Rodan

Codes :

(a) (b) (c) (d)

(A) (iv) (iii) (i) (ii)

(B) (iii) (iv) (ii) (i)

(C) (ii) (i) (iv) (iii)

(D) (i) (ii) (iii) (iv)

22. (Quarternary)

(A)

(B)

(C)

(D)

23.

(a)

(b)

(c)

(d)

(i)

(ii)

(iii)

(iv)

::::

(a) (b) (c) (d)

(A) (iv) (iii) (i) (ii)

(B) (iii) (iv) (ii) (i)

(C) (ii) (i) (iv) (iii)

(D) (i) (ii) (iii) (iv)

14141414


24. To ensure fiscal autonomy to states,

14th Finance Commission

recommended to increase its share

from :

(A) 32% to 42%

(B) 30% to 42%

(C) 30% to 40%

(D) 35% to 40%

25. An Integrated Goods and Services

Tax (IGST) would be collected by :

(A) State Governments

(B) Central Government

(C) Municipal Corporations

(D) Finance Commission

26. Who is not the member of 14th

Finance Commission ?

(A) Sushma Nath

(B) Sudipto Mundle

(C) M. Govind Rao

(D) C.H. Hanumanta Rao

24.

(A) 32% 42%

(B) 30% 42%

(C) 30% 40%

(D) 35% 40%

25.

(A)

(B)

(C)

(D)

26.

(A)

(B)

(C)

(D)

15 [P.T.O.15 [P.T.O.15 [P.T.O.15 [P.T.O.


27. Which one of the following is not a

Non-Debt Capital Receipts ?

(A) Disintvestment receipts

(B) Dividend receipts

(C) Short-term borrowing

(D) Tax Revenue

28. A public good is ..................... .

(A) A good that the public must pay

for

(B) Non-rival in consumption

(C) More costly than a private good

(D) Paid for by a government

29. Reduction in consumer’s welfare as

a result of tax is referred to :

(A) Equity in taxation

(B) Dead weight loss

(C) Efficiency in taxation

(D) Incidence of tax

30. Which one of the following is the

major component of revenue

expenditure of Central Government ?

(A) Pensions

(B) Interest payments

(C) Defence expenditure

(D) Expenditure on education

27.

(A)

(B)

(C)

(D)

28.

(A)

(B)

(C)

(D)

29.

(A)

(B)

(C)

(D)

30.

(A)

(B)

(C)

(D)

16161616


31. All transactions of ............... nature

are included in the current account

of Balance of Payments.

(A) Stock

(B) Volatile

(C) Flow

(D) Fluctuating

32. The commodity in which a nation

has the least absolute disadvantage

represents its area of :

(A) Comparative disadvantage

(B) Comparative advantage

(C) Absolute advantage

(D) Cannot say without additional

information

33. Ricardo’s theory of comparative

advantage is based on :

(A) The opportunity cost theory

(B) The labour theory of value

(C) The law of diminishing returns

(D) The psychological law of

consumption

31.

(A)

(B)

(C)

(D)

32.

(A)

(B)

(C)

(D)

33.

(A)

(B)

(C)

(D)

17 [P.T.O.17 [P.T.O.17 [P.T.O.17 [P.T.O.


34. We can best understand Smith’s

views on trade if we regard them as

a reaction to :

(A) The law of comparative

advantage

(B) The mercantilist view on trade

(C) Ricardo’s views on trade

(D) The law of absolute advantage

35. Uniformity in exchange rate occurs

due to :

(A) Foreign exchange arbitrage

(B) Devaluation

(C) Hedging

(D) Speculation

36. If a country can produce 10 units

of good x or 4 units of good y, the

opportunity cost of 1 y is :

(A) 1 x

(B) 0.4 x

(C) 2.5 x

(D) 10 x

34.

(A)

(B)

(C)

(D)

35.

(A)

(B)

(C)

(D)

36.

(A)

(B)

(C)

(D)

18181818



(a) Infant industry argument

(b) Import substituting industrial-

ization

(c) Reduction in the rates of

protection for manufacturing by

developing countries

(d) Industrialization of high

performance Asian economies

(i) Domestic industries are

established under the protection

of tariffs or import quotas

(ii) New industries need a temporary

period of protection

(iii)Not via import substitution but

via export of manufactured goods

(iv) Rapid growth of trade

Codes :

(a) (b) (c) (d)

(A) (iii) (i) (iv) (ii)

(B) (iv) (i) (ii) (iii)

(C) (iii) (iv) (i) (ii)

(D) (ii) (i) (iv) (iii)

37. :

(a)

(b)

(c)

(d)

(i)

(ii)

(iii)

(iv)

::::

(a) (b) (c) (d)

(A) (iii) (i) (iv) (ii)

(B) (iv) (i) (ii) (iii)

(C) (iii) (iv) (i) (ii)

(D) (ii) (i) (iv) (iii)

19 [P.T.O.19 [P.T.O.19 [P.T.O.19 [P.T.O.


38. What can you say about the

following statements pertaining to

Foreign Direct Investment in India ?

(i) FDI through automatic route

does not require prior govt.

approval.

(ii) FDI through government route

requires approval of the

government through Foreign

Investment Promotion Board.

(A) Both statement (i) and

statement (ii) are incorrect

(B) Statement (i) is incorrect and

statement (ii) is correct

(C) Both statement (i) and

statement (ii) are correct

(D) Statement (i) is correct and

statement (ii) is incorrect

39. Which of the following is not a tool

used by RBI for regulating money

supply in India ?

(i) Open market operations

(ii) Repo rate

(iii) Statutory Liquidity Ratio

(iv) Disinvestment

(A) (iv)

(B) (i)

(C) (iii)

(D) (ii)

38.

(i)

(ii)

(A) (i) (ii)

(B) (i) (ii)

(C) (i) (ii)

(D) (i) (ii)

39.

(i)

(ii)

(iii)

(iv)

(A) (iv)

(B) (i)

(C) (iii)

(D) (ii)

20202020


40. Which of the following are examples

of a direct tax in India ?

(i) Excise duty

(ii) Service tax

(iii) Income tax

(A) (i), (ii), (iii)

(B) Only (iii)

(C) (i) and (iii)

(D) (ii) and (iii)

41. In the year 1966, the exchange

value of rupee against American

dollar was devalued by ................ .

(A) 75%

(B) 65%

(C) 48%

(D) 57%

42. The All India Rural Credit Survey

Committee, 1954 was chaired by :

(A) D.R. Gadgil

(B) V.K.R.V. Rao

(C) A.D. Gorawala

(D) Vaikunthlal Mehta

40.

(i)

(ii)

(iii)

(A) (i), (ii), (iii)

(B) (iii)

(C) (i) (iii)

(D) (ii) (iii)

41.

(A) 75%

(B) 65%

(C) 48%

(D) 57%

42.

(A)

(B)

(C)

(D)

21 [P.T.O.21 [P.T.O.21 [P.T.O.21 [P.T.O.


43. Among top fifteen fastest growing

service sector countries ........... share

of services in its total GDP is less

than 50 percentage.

(A) France

(B) Germany

(C) China

(D) Australia

44. Which is the correct descending

order of India’s software export

destination in recent times ?

(i) Asia Pacific, North America,

Europe

(ii) Europe, Asia Pacific, North

America

(iii) Europe, North America, Asia

Pacific

(iv) North America, Europe, Asia

Pacific

(A) (iv)

(B) (iii)

(C) (i)

(D) (ii)

43.

GDP

(A)

(B)

(C)

(D)

44.

(i)

(ii)

(iii)

(iv)

(A) (iv)

(B) (iii)

(C) (i)

(D) (ii)

22222222


45. The abbreviation ICOR suggests :

(A) International Credit Output

Ratio

(B) Incremental Capital Output

Ratio

(C) Incremental Capital Output

Range

(D) Indian Capital Output Rules

46. Statistic is a numerical quantity

which is calculated from :

(A) Population

(B) Sample

(C) Universe

(D) Hypothesis

47. Which of the following is used in

chain indices ?

(A)0

100np

p�

��

(B)1

100n

n

p

p �

��

�

(C)0

100np

p�

(D)0 0

100n np q

p q

��

�

45. ICOR

(A)

(B)

(C)

(D)

46.

(A)

(B)

(C)

(D)

47.

(A)0

100np

p�

��

(B)1

100n

n

p

p �

��

�

(C)0

100np

p�

(D)0 0

100n np q

p q

��

�

23 [P.T.O.23 [P.T.O.23 [P.T.O.23 [P.T.O.


48. The most suitable average for

qualitative measurements is

..................... .

(A) Arithmetic mean

(B) Median

(C) Correlation coefficient

(D) Geometric mean

49. The strength (degree) of the

relationship between a set of

independent variable x and

dependent variable y is measured

by :

(A) Coefficient of correlation

(B) Coefficient of determination

(C) Standard Error of estimate

(D) All of the above

50. Consumer Price Index number is

also known as :

(A) Wholesale Price Index number

(B) Cost of Living Index

(C) Sensitive

(D) Composite

48.

(A)

(B)

(C)

(D)

49. (x)

(y)

(A)

(B)

(C)

(D)

50.

(A)

(B)

(C)

(D)

24242424


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